The reason for this is that when the principal dies, the property passes to his heirs. Therefore, the agency must be renewed if they wish to continue with the agent. As for the agent, the agency is invalidated by his death, because the principal approved of him personally. When he dies, the subject matter of the contract has ceased and is lost; thus, the agency is invalidated.
An example of this is a man who appoints someone as his agent to sell his house, saying, “I appoint you as my agent to sell my house.” Then Allah decrees that the principal dies. In that case, it is not lawful for the agent to sell the house or dispose of it in any way. Rather, he must inform the heirs that the agency has ended, because ownership has now passed to the heirs.
Another example: a man appoints someone as his agent to make a sale, then Allah decrees that the agent dies. The agency is thereby dissolved, and it is not lawful for the agent to appoint someone after his death to undertake the sale, because the agency has been dissolved by his death.
Here we must draw attention to an issue concerning our brothers who draft people’s wills. If a person makes a will and says, “I bequeath one-third of my wealth to be given in charity to the poor,” many writers state: “So-and-so is the agent responsible for this.” The correct wording is: “So-and-so is the executor responsible for this,” because there is a difference between an agent and an executor. An executor is someone authorized to dispose of property after death, whereas an agent is someone authorized to dispose of property during the principal’s lifetime. If he says, “So-and-so is the agent responsible for my one-third,” then, if we were to take the wording literally, we would say that when this man dies, the agency is dissolved. However, judges rule that this expression, when used by ordinary people, means an executorship, even if it is phrased as an agency. Nevertheless, we say to writers: you should be precise in your drafting. When you mention someone’s bequest of something, do not say, “So-and-so is the agent”; rather, say, “So-and-so is the executor.”